Coca-Cola battles UK unions over pay

By Ahmed ElAmin

- Last updated on GMT

Related tags Coca-cola

Planned 48-hour strikes at two UK distribution centres will not
disrupt the supply of its beverages, Coca-Cola Enterprises (CCE)
said yesterday.

The battle between the company and unionised workers provides an insight into the cost of staff at distribution centres and the attempt by Coca-Cola to hold down costs.

In deciding to hold out against the union demands the company is also taking a chance that the wage dispute could escalate during the summer months to other sites, when sales of its drinks reach a peak.

"Although Milton Keynes and Wakefield are both important sites for CCE, the company does not foresee customers having any supply problems," the company said in response to a union statement.

"CCE also operates four other sites in Great Britain and has a network of external suppliers and strong stock levels in preparedness."

The Unite union said this week that the walk-outs will take place on 26 and 27 July and on 13 and 14 August at the Wakefield, West Yorkshire distribution site.

Another 140 staff at a depot at Milton Keynes will also walk out for 24 hours on 27 July.

The workers at Wakefield also begin a continuous overtime ban from 23 July.

CCE said the breakdown in talks occured after "many weeks" of discussions and said its salary package for its employees in the UK is based on a review of the local market and benchmarking with a range of peer companies.

Workers want a 3.8 per cent payrise instead of the 2.5 per cent offered by CCE.

"As a result of CCE's benchmarking of the negotiated groups at Milton Keynes and Wakefield, the company found the average salary was significantly higher than comparative jobs in other companies in the area," the company stated.

The average salary for someone working in the negotiated groups in Milton Keynes or Wakefield is £32,000 plus a package of additional benefits including a final salary pension, healthcare, and share scheme, the company stated.

In addition CCE has been paying an extra £23 million a year above the normal level of investment since 2005 into its final salary pension scheme.

Employee turnover at the Milton Keynes and Wakefield plants are less than one per cent compared to an industry average of about 2 per cent, the company stated.

"We cannot however justify a settlement at Milton Keynes and Wakefield of almost double the 2007 norm and feel this would be unfair to the rest of our associates across the rest of the British business," Coca-Cola stated.

Almost all of CCE Ltd's 4,600 employees have had a basic pay rise of 2.5 per cent during 2007, the company stated.

Meanwhile the Unite union said that 82 per cent of its members at the Wakefield site rejected a two-year pay deal which it said offered a 2.5 per cent pay rise but would force them to sacrifice parts of their overtime rates and bonuses.

"It's unacceptable that one of the world's most famous brands is offering workers a pay cut this year for their hard work," said Unite regional officer Kelvin Mawer.

"Shops, supermarkets, pubs and hotels now face the prospect of shortages of Coca Cola during the height of the summer."

Unite estimates that CCE will lose 1,000 working hours as a result of the overtime ban.

The Wakefield manufacturing plant produces up to 6,000 cans and 1,650 bottles of soft drink a minute, the union stated.

The Wakefield sites employs 517 staff including manufacturing and distribution technicians, local delivery drivers and distribution workers.

The GMB union represents the 140 employees at CCE's Milton Keynes site.

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